Malpractice insurance has become extremely expensive for some sorts of medical professionals. Patients should worry about this because of the problems of:
arbitrage. adverse selection. free riding. moral hazard.
A market in which quality depends on price (rather than price depending on quality) may differ from a normal supply-demand market because it may have:
a downward-sloping supply curve. a horizontal demand curve. an equilibrium price that does not clear the market. opportunities for arbitrage.
